MPPSC MAINS | BUDGET 2025-25 PART 2 | ECCONOMY | PAPER 3 PART A UNIT 2

🇮🇳 Indian Budget 2025-26 Explained | Key Highlights, Schemes & Analysis

The Union Budget 2025-26, presented by Finance Minister Nirmala Sitharaman, sets a bold yet balanced roadmap for India’s growth story. With the vision of “Viksit Bharat by 2047” and the theme “Sabka Vikas”, this year’s budget focuses on economic stability, infrastructure expansion, social welfare, and the empowerment of the middle class. Let’s understand in simple terms what this budget means for the nation and for you.

🔹 Overall Financial Outlook

The total expenditure for FY 2025-26 is pegged at ₹50.65 lakh crore, while total receipts (excluding borrowings) are expected to be around ₹34.96 lakh crore. The government has targeted a fiscal deficit of 4.4% of GDP, a significant improvement from the previous year’s 5.1%. This indicates the Centre’s commitment to fiscal discipline even while pushing for growth.

The government continues its capital expenditure (CapEx) push — ₹11.21 lakh crore, about 3.1% of GDP, has been allocated for infrastructure, transport, and public projects. This sustained investment in capital creation is expected to generate employment and attract private investment, ensuring that India’s growth momentum remains strong.

🔹 Tax Reforms and Reliefs

The budget brings cheer to the middle class with a major revision in income tax slabs. Under the new tax regime, income up to ₹12 lakh is now tax-free, providing direct relief to crores of taxpayers. The revised structure simplifies compliance and encourages more individuals to shift to the new system.

For businesses and individuals, TDS (Tax Deducted at Source) limits have been rationalized — the threshold for rent has been raised from ₹2.4 lakh to ₹6 lakh per year. The time limit for updated returns has been extended from 2 years to 4 years, allowing taxpayers to correct mistakes without penalties.

Additionally, charitable trusts and institutions now have a longer registration period (10 years instead of 5), reducing paperwork and compliance burden. These measures show the government’s intention to simplify taxation and improve transparency.

🔹 Agriculture and Rural Development

Agriculture remains the backbone of India’s economy, and this budget reinforces that. A new Prime Minister Dhan-Dhaanya Krishi Yojana has been launched in 100 districts to enhance productivity and ensure food security. A 6-year “Mission for Aatmanirbharta in Pulses” will reduce India’s dependence on pulse imports by boosting domestic cultivation and farmer support.

The government has also announced a multi-sectoral rural employment programme focusing on skilling, technology adoption, and investment. This aims to reduce underemployment in rural areas and create sustainable livelihoods.

Investment in agricultural research, irrigation, storage, and crop insurance has been increased. The emphasis is on transforming agriculture into a profitable, technology-driven sector that ensures both food security and farmer prosperity.


🔹 Technology, Innovation, and Start-ups

The 2025-26 budget clearly recognizes technology as the future of growth. Special incentives are provided for electronics manufacturing, EVs, batteries, and semiconductor production under the Make in India framework.

The government announced the creation of AI Centres of Excellence to promote research and development in artificial intelligence, robotics, and quantum computing. Funding for deep-tech start-ups, digital skilling programs, and innovation clusters will further boost India’s digital economy.

Tax incentives for start-ups and the simplification of compliance norms are steps to make India a global innovation hub. This reflects the vision of building a knowledge-based, future-ready economy.

🔹 Who Benefits from the Budget?

✅ Middle Class: Major tax relief up to ₹12 lakh, better savings potential.
✅ Farmers: New agricultural schemes, higher MSP support, and self-reliance in pulses.
✅ Start-ups & Businesses: Simplified tax structure, easier compliance, funding support.
✅ Youth: Skill development, job creation, and start-up ecosystem growth.
✅ States & Local Governments: Increased capital transfers and flexibility.

🔹 Conclusion

The Union Budget 2025-26 is not just a financial statement — it’s a blueprint for a “Viksit Bharat”. It focuses on fiscal responsibility while fueling inclusive and sustainable growth. With bold tax reforms, a strong push for infrastructure, and an emphasis on innovation and human development, it reflects both ambition and prudence.

As India steps into the next decade of development, this budget sets the direction for self-reliance, opportunity, and progress for all.
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